Hyflux

Hyflux: Generally in line results. Despite rev at $86.8m -14.3%yoy, net profit at $7.4m was up 15.3%yoy mainly due to a fall in costs of raw materials and labour. Cash fell significantly by $56.9m to $165.4m largely due to outflows of $54.3 in operations, and net gearing at 84.2%. Its recent $400m pref share offering should shore up its capital base and provide funding for further projects…

Of note, its $890m project Tuas II desalination plant is to be completed by 2013 which offers some earnings visibility. China was the top contributor with 40% of rev and MENA at 39% with the municipal sector forming approx 81% of rev as well. Co’s order book now stands at $2.3b CIMB maintains Outperform at TP$2.76.